MNI DAILY TECHNICAL ANALYSIS -  EURUSD Recovers And Remains Inside Its Bear Channel

Price Signal Summary - EURUSD Recovers And Remains Inside Its Bear Channel

• In the equity space, S&P E-Minis trend conditions remain bearish. This week’s trend lows, strengthens bearish conditions and note that a key support at 3657.00, the Jun 17 low and an important medium-term bear trigger, has been pierced. A clear break would confirm a resumption of the broader downtrend. The focus is on 3600.00 next. EUROSTOXX 50 futures remain vulnerable following the reversal on Sep 13, from 3678.00, the Jun 13 high and this week’s follow through. Key short-term support at 3341.00, the Jul 5 low, has been breached. The focus is on 3229.00 next, the Nov 9 2020 low (cont).
• In FX, EURUSD short-term gains are considered corrective. The move higher yesterday and a higher print today, does suggest scope for an extension of the correction. Note too that the bounce from Wednesday’s low of 0.9536 means the bear channel base, at 0.9486 today, has provided support. The 20-day EMA, at 0.9871 represents the next resistance, a break would be a positive development. The channel top intersects at 1.0025. A resumption of weakness would open 0.9536/9486. GBPUSD traded higher yesterday and cleared 1.0931, the Sep 26 high. The recovery reinforces the importance of Monday’s hammer reversal candle and suggests scope for stronger corrective bounce. The next resistance is 1.1271, the 20-day EMA. A break would strengthen the current short-term bull cycle. This week’s 1.0350 low is key support. USDJPY key support is 140.36, the Sep 22 low, where a break is required to highlight a top. The uptrend remains intact and attention is on the bull trigger at 145.90, Sep 22 high. A break would confirm a resumption of the trend and open 146.03, 2.764 projection of the Aug 2 - 8 - 11 price swing. Initial support is 142.76, the 20-day EMA.
• On the commodity front, Gold remains in a downtrend and short-term gains are considered corrective. Fresh trend lows this week confirm a resumption of the trend and this opens $1610.5, the 1.00 projection of the Jun 13 - Jul 21 - Aug 10 swing. The next resistance is at $1678.3, the 20-day EMA. In the Oil space, a bearish threat in WTI futures remains present and the recovery from Monday’s low is considered corrective. The recent break of support at $84.25, Jul 14 low, confirmed a resumption of the downtrend that started Jun 8. Attention is on $76.11, 1.618 projection of the Jul 29 - Aug 16 - 30 price swing. First resistance is at $83.72, the 20-day EMA.
• In the FI space, Bund futures remain in a clear downtrend and the extension lower this week, confirmed a resumption of the bear leg that started early August. The focus is on 135.27, the Mar 2012 low (cont). Gilts have traded in an extremely volatile manner this week, however, trend signals remain bearish. A resumption of weakness would refocus attention on 90.99, Wednesday low and the bear trigger. Note that Wednesday’s price pattern is a bullish engulfing candle. However, additional reinforcing price evidence is required to validate this signal and confirm a short-term shift in market sentiment. This would signal scope for a stronger short-term correction.

FOREIGN EXCHANGE

EURUSD TECHS: Corrective Cycle Extends

• RES 4: 1.0051 High Sep 20
• RES 3: 1.0025 Bear channel top drawn from the Feb 10 high
• RES 2: 0.9907 High Sep 22
• RES 1: 0.9871 20-day EMA
• PRICE: 0.9805 @ 05:54 BST Sep 30
• SUP 1: 0.9636/9536 Low Sep 29 / 28
• SUP 2: 0.9501 1.382 projection of the Aug 10 - Sep 6 - 12 price swing
• SUP 3: 0.9486 Bear channel base drawn from the Feb 10 high
• SUP 4: 0.9442 1.50 projection of the Aug 10 - Sep 6 - 12 price swing

EURUSD short-term gains are considered corrective. The move higher yesterday and a higher print today, does suggest scope for a continuation of the recovery and an extension of the correction. Note too that the bounce from Wednesday’s low means the channel base, at 0.9486 today, has provided support. The 20-day EMA, at 0.9871 represents the next resistance. On the downside a resumption of weakness would open 0.9536/9486.

GBPUSD TECHS: Hammer Candle Still In Play As Correction Extends

• RES 4: 1.1604 50-day EMA
• RES 3: 1.1461 High Sep 20
• RES 2: 1.1364 High Sep 22
• RES 1: 1.1271 20-day EMA
• PRICE: 1.1114 @ 06:04 BST Sep 30
• SUP 1: 1.0763 Low Sep 29
• SUP 2: 1.0541/0350 Low Sep 28 / All Time Low
• SUP 3: 1.0203 3.236 proj of the Jun 16 - Jul 14 - Aug 1 price swing
• SUP 4: 1.0108 3.382 proj of the Jun 16 - Jul 14 - Aug 1 price swing

GBPUSD traded higher yesterday and cleared 1.0931, the Sep 26 high. The recovery reinforces the short-term importance of Monday’s hammer reversal candle and suggests scope for stronger corrective bounce. This is allowing a recent oversold trend reading to unwind. The next resistance is 1.1271, the 20-day EMA. A break would strengthen the current short-term bull cycle. This week’s 1.0350 low remains the bear trigger and key support.

EURGBP TECHS: Approaching The 20-Day EMA

• RES 4: 0.9501 High Mar 19 2020 and major resistance
• RES 3: 0.9388 High Mar 23 2020
• RES 2: 0.9292 High Sep 11 2020
• RES 1: 0.9066/9266 High Sep 28 / High Sep 26 and key resistance
• PRICE: 0.8815 @ 06:20 BST Sep 30
• SUP 1: 0.8764 20-day EMA
• SUP 2: 0.8692 Low Sep 22
• SUP 3: 0.8643 50-day EMA
• SUP 4: 0.8626 Low Sep 14

EURGBP remains well below Monday’s high of 0.9266 - a key short-term resistance. The cross has entered a corrective cycle and this is allowing a recent overbought trend reading to unwind. The next support is 0.8764, the 20-day EMA. A break would signal scope for an extension, perhaps towards the 50-day EMA, at 0.8643. Initial resistance is seen at 0.9066, the Sep 28 high.

USDJPY TECHS: Bull Trigger Remains Exposed

• RES 4: 146.52 1.236 proj of the May 24 - Jul 14 - Aug 2 price swing
• RES 3: 146.03 2.764 proj of the Aug 2 - 8 - 11 price swing
• RES 2: 145.90 High Sep 22 and the bull trigger
• RES 1: 144.90 High Sep 27
• PRICE: 144.57 @ 06:27 BST Sep 30
• SUP 1: 142.76/141.77 20-day EMA / Low Sep 23
• SUP 2: 140.36 Low Sep 22 and key short-term support
• SUP 3: 139.84 50-day EMA
• SUP 4: 139.39 High Jul 14 and a former key resistance

USDJPY is unchanged and in consolidation mode. The pair is holding on to the recovery from 140.36, the Sep 22 low. This level has been defined as a key short-term support where a break is required to highlight a top and the potential for a deeper retracement. The uptrend remains intact and attention is on the bull trigger at 145.90, the Sep 22 high. A break would confirm a resumption of the primary uptrend and open 146.03, a Fibonacci projection.

EURJPY TECHS: Bull Cycle Extends

• RES 4: 145.64 High Sep 12 and the bull trigger
• RES 3: 144.48 High High Sep 14
• RES 2: 143.70 76.4% retracement of the Sep 12 - 26 downleg
• RES 1: 142.49 61.8% retracement of the Sep 12 - 26 downleg
• PRICE: 141.96 @ 06:36 BST Sep 29
• SUP 1: 139.44/137.40 Low Sep 29 / 26 and key support
• SUP 2: 136.02 Low Aug 25
• SUP 3: 135.52 Low Aug 24
• SUP 4: 134.95 Low Aug 16 and a key support

EURJPY traded higher yesterday, extending the recovery from 137.40, the Sep 26 low. Recent weakness between Sep 12 - 26 appears to have been a correction and if correct, the latest recovery signals the end of that bear cycle. An extension would open 143.70, a Fibonacci retracement and signal scope for a climb towards key resistance at 145.64, the Sep 12 high. On the downside, key support lies at 137.40, the Sep 26 low.

AUDUSD TECHS: Remains Vulnerable

• RES 4: 0.6785 50-day EMA
• RES 3: 0.6705 High Sep 21
• RES 2: 0.6657 20-day EMA
• RES 1: 0.6550 High Sep 26
• PRICE: 0.6504 @ 08:11 BST Sep 30
• SUP 1: 0.6363 Low Sep 28
• SUP 2: 0.6337 Low Apr 24 2020
• SUP 3: 0.6283 Low Apr 23 2020
• SUP 4: 0.6255 1.236 proj of the Apr 5 - May 12 - Jun 3 price swing

AUDUSD remains in a downtrend and Wednesday's bounce is considered corrective. The recent break of support at 0.6682, the Jul 14 low and a bear trigger, strengthened bearish conditions and has maintained the broader downward price sequence of lower lows and lower highs. The focus is on 0.6337 next, the Apr 24 2020 low. Initial firm resistance has been defined at 0.6657, the 20-day EMA.

USDCAD TECHS: Northbound

• RES 4: 1.4000 Psychological round number
• RES 3: 1.3970 3.236 proj of the Aug 25 - Sep 7 - 13 price swing
• RES 2: 1.3896 3.00 proj of the Aug 25 - Sep 7 - 13 price swing
• RES 1: 1.3833 High Sep 28
• PRICE: 1.3681 @ 08:14 BST Sep 30
• SUP 1: 1.3560/3468 Low Sep 26 / 23
• SUP 2: 1.3381 20-day EMA
• SUP 3: 1.3169 50-day EMA
• SUP 4: 1.2954 Low Sep 13 and a key support

USDCAD traded higher Wednesday and a bullish theme remains intact. The recent extension reinforces the uptrend and maintains the positive price sequence of higher highs and higher lows. Moving average studies are in a bull mode position, highlighting current market sentiment. Sights are set on 1.3896 next, a Fibonacci projection. On the downside, initial firm support is at 1.3381, the 20-day EMA.

FIXED INCOME

BUND TECHS: (Z2) Trend Direction Remains Down

• RES 4: 142.58 High Sep 20
• RES 3: 142.02 High Sep 22
• RES 2: 141.73 20-day EMA
• RES 1: 139.29/140.99 High Sep 27 / 23
• PRICE: 137.06 @ 05:19 BST Sep 30
• SUP 1: 135.41 4.236 proj of the Aug 2 - 12 - 15 price swing
• SUP 2: 135.27 Low Mar 2012 (cont)
• SUP 3: 134.76 4.382 proj of the Aug 2 - 12 - 15 price swing
• SUP 4: 134.24 4.50 proj of the Aug 2 - 12 - 15 price swing

Bund futures remain in a downtrend and moving average studies point south. The extension lower this week confirms a continuation of the bear cycle that started early August. A major support at 140.67, Jun 16 low (cont), has been cleared. The break strengthens the broader bearish outlook and confirms a resumption of the primary downtrend. Attention is on 135.27 next, the Mar 2012 low (cont). The 20-day EMA, at 141.73 remains a firm resistance.

BOBL TECHS: (Z2) Trend Needle Still Points South

• RES 4: 121.570 High Sep 19
• RES 3: 120.940 High Sep 21
• RES 2: 120.857 20-day EMA
• RES 1: 120.150 High 23
• PRICE: 119.020 @ 05:23 BST Sep 30
• SUP 1: 118.020 Low Sep 28
• SUP 2: 117.918 2.382 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 3: 117.630 2.50 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 4: 117.342 2.618 proj of the Aug 25 - Sep 1 - Sep 6 price swing

The trend needle in Bobl futures is unchanged and still points south. This week’s fresh cycle lows reinforce bearish conditions. A key support at 119.940, the Jun 16 low (cont) and the bear trigger, has recently been cleared. The break confirms a resumption of the broader downtrend and opens 117.918 next, a Fibonacci projection. Firm resistance is seen at 120.857, the 20-day EMA.

SCHATZ TECHS: (Z2) Gains Considered Corrective

• RES 4: 107.585 High Sep 19
• RES 3: 107.416 20-day EMA
• RES 2: 107.380 High Sep 20
• RES 1: 107.265 Intraday high
• PRICE: 107.110 @ 10:01 BST Sep 30
• SUP 1: 106.513 2.236 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 2: 106.379 2.382 proj of the Aug 25 - Sep 1 - Sep 6 price swing
• SUP 3: 106.000 Round number support
• SUP 4: 105.800 Low Nov 2008 (cont)

The Schatz futures trend direction remains down and short-term gains are considered corrective. Recent fresh trend lows confirm an extension of the bear cycle. This also maintains the current bearish price sequence of lower lows and lower highs and moving average studies remains in a bear mode position. The focus is on 106.513 next, a Fibonacci projection. On the upside, initial firm resistance is seen at 107.416, the 20-day EMA.

GILT TECHS: (Z2) Bullish Engulfing Candle?

• RES 4: 102.37 20-day EMA
• RES 3: 100.00/102.45 Round number resistance / High Sep 23
• RES 2: 98.68 Low Sep 23 and gap high on the daily chart
• RES 1: 97.43 High Sep 27
• PRICE: 96.53 @ Close Sep 29
• SUP 1: 90.99 Low Sep 28 and the bear trigger
• SUP 2: 90.57 2.618 proj of the May 12 - Jun 16 - Aug 2 swing (cont)
• SUP 3: 90.00 Psychological round number
• SUP 4: 88.94 2.764 proj of the May 12 - Jun 16 - Aug 2 swing (cont)

A strong rally Wednesday in Gilt futures led to a short-term reversal. In pattern terms, Wednesday session is a bullish engulfing candle. However, additional reinforcing price evidence is required to validate this signal and confirm a short-term shift in market sentiment. An extension higher would be positive and signal potential for a climb towards the 100.00 handle initially. Key support and the bear trigger has been defined at 90.99, the Sep 28 low.

BTP TECHS: (Z2) Bearish Outlook

• RES 4: 118.51 High Sep 13
• RES 3: 117.05 High Sep 22
• RES 2: 115.15 20-day EMA
• RES 1: 113.46/114.67 High Sep 26 / Low Sep 20
• PRICE: 110.83 @ Close Sep 29
• SUP 1: 107.99 2.236 proj of the Aug 25 - Sep 1 - 8 price swing
• SUP 2: 107.27 2.382 proj of the Aug 25 - Sep 1 - 8 price swing
• SUP 3: 107.00 round number support
• SUP 4: 106.68 2.618 proj of the Aug 25 - Sep 1 - 8 price swing

BTP futures trend conditions remain bearish. Fresh trend lows this week have confirmed a resumption of the bear cycle. Moving averages are in a bear mode condition too, highlighting the current market sentiment. A resumption of weakness would open 107.27, a Fibonacci projection. On the upside, initial firm resistance is seen at 115.15, the 20-day EMA. Gains would be considered corrective.

US 10YR FUTURE TECHS: (Z2) Corrective Bounce

• RES 4: 115-06+ High Sep 14
• RES 3: 114-17 High Sep 20
• RES 2: 114-10 20-day EMA
• RES 1: 112-30+/114-00 High Sep 23 / 22
• PRICE: 112-02 @ 15:10 BST Sep 29
• SUP 1: 110-19 Low Sep 28
• SUP 2: 110-00 Psychological Support
• SUP 3: 109 26+ 3.0% 10-dma envelope
• SUP 4: 109-23+ Low Nov 30 20074 (cont)

Treasuries remain vulnerable despite the Wednesday rally. The latest extension of the downtrend together with this week’s move lower, has reinforced current conditions. A bearish price sequence of lower lows and lower highs and bearish moving average studies clearly highlight the market's bearish sentiment. The focus is on 109-26+ a lower moving average band value. Initial resistance is last Friday’s high of 112-30+.

EQUITIES

EUROSTOXX50 TECHS: (Z2) Fresh Trend Low

• RES 4: 3753.00 High Aug 19
• RES 3: 3692.00 High Aug 26
• RES 2: 3678.00 High Sep 13 and bull trigger
• RES 1: 3448.10/3527.00 20-day EMA / 50-day EMA
• PRICE: 3267.00 @ 05:45 BST Sep 30
• SUP 1: 3229.00 Low Nov 9 2020 (cont)
• SUP 2: 3163.00 Low Nov 6 2020
• SUP 3: 3143.20 1.382 proj of the Aug 17 - Sep 5 - 13 price swing
• SUP 4: 3100.00 Round number support

EUROSTOXX 50 futures trend conditions remain bearish and yesterday’s fresh trend low reinforces current conditions. This week's bearish extension confirms a continuation of the reversal on Sep 13 from 3678.00. Key short-term support at 3341.00, the Jul 5 low, has been cleared. The break strengthens bearish conditions and the focus is on 3229.00 next, the Nov 9 2020 low (cont). Resistance is at 3448.10, the 20-day EMA.

E-MINI S&P (Z2): Bear Trend Intact

• RES 4: 4313.50 High Aug 18
• RES 3: 4234.25 High Aug 26
• RES 2: 3960.72/4175.00 50-day EMA / High Sep 13
• RES 1: 3853.86/3936.25 20-day EMA / High Sep 20
• PRICE: 3657.75 @ 06:52 BST Sep 30
• SUP 1: 3600.00 Round number support
• SUP 2: 3558.97 1.382 proj of the Aug 16 - Sep 7 - 13 price swing
• SUP 3: 3506.38 1.50 proj of the Aug 16 - Sep 7 - 13 price swing
• SUP 4: 3453.78 1.618 proj of the Aug 16 - Sep 7 - 13 price swing

S&P E-Minis trend conditions remain bearish and short-term gains are considered corrective. The recent move lower strengthens bearish conditions and attention is on key support at 3657.00, the Jun 17 low. This support has been pierced. A clear break would strengthen bearish conditions and confirm a resumption of the broader downtrend. This would open 3600.00 next. Initial firm resistance is at 3936.25, Sep 20 high.

COMMODITIES

BRENT TECHS: (X2) Corrective Bounce

• RES 4: $107.30 - High Jul 5
• RES 3: $96.99/103.86 - High Sep 5 / High Jul 29 and key resistance
• RES 2: $93.83 - 50-day EMA
• RES 1: $90.52 - 20-day EMA
• PRICE: $88.38 @ 06:35 BST Sep 30
• SUP 1: $83.65 - Low Sep 26 and the bear trigger
• SUP 2: $82.59 - 1.618 proj of the Jul 29 - Aug 17 - 30 price swing
• SUP 3: $80.71 - 1.764 proj of the Jul 29 - Aug 17 - 30 price swing
• SUP 4: $79.12 - Low Jan 24

Brent futures traded higher again yesterday, extending the bounce from Monday’s low of $83.65. Short-term gains are considered corrective. The contract traded lower Monday and this confirms a resumption of the broader downtrend. The move lower strengthens bearish conditions and maintains the price sequence of lower lows and lower highs. The focus is on $82.59 next, a Fibonacci projection. Firm trend resistance is at the 50-day EMA, at $93.83.

WTI TECHS: (X2) Corrective Bounce Extends

• RES 4: $97.91 - High Jul 29 and a reversal trigger
• RES 3: $92.26/96.82 - High Aug 30 / 31 and key resistance
• RES 2: $87.58 - 50-day EMA
• RES 1: $83.72 - 20-day EMA
• PRICE: $81.27 @ 08:23 BST Sep 30
• SUP 1: $76.11 - 1.618 proj of the Jul 29 - Aug 16 - 30 price swing
• SUP 2: $75.70 - Low Jan 24
• SUP 3: $71.22 - 2.00 proj of the Jul 29 - Aug 16 - 30 price swing
• SUP 4: $68.20 - 2.236 proj of the Jul 29 - Aug 16 - 30 price swing

WTI futures traded higher again Thursday. Bearish conditions remain intact though and the climb from Monday’s low is considered corrective. The contract has recently cleared support at $80.89, Sep 8 low. This marks a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. The move lower opens $76.11 next, a Fibonacci projection. Key short-term resistance is at $87.58 the 50-day EMA.

GOLD TECHS: Short-Term Corrective Cycle

• RES 4: $1765.5 - High Aug 25 and a key resistance
• RES 3: $1716.5/35.1 - 50-day EMA / High Sep 12
• RES 2: $1688.0/1707.1 - High Sep 21 / High Sep 14
• RES 1: $1678.3 - 20-day EMA
• PRICE: $1665.5 @ 07:19 BST Sep 30
• SUP 1: $1615.0 - Low Sep 28 and the bear trigger
• SUP 2: $1610.5 - 1.00 proj of the Jun 13 - Jul 21 - Aug 10 swing
• SUP 3: $1569.1 - Low Apr 1 2020
• SUP 4: $1563.9 - 1.236 proj of the Jun 13 - Jul 21 - Aug 10 swing

Gold has recovered from Wednesday's low of $1615.0. Short-term gains are considered corrective and the downtrend remains intact. The next resistance is at $1678.3, the 20-day EMA. A break of this level would signal scope for an extension higher. On the downside, $1615.0 is the bear trigger. A breach would confirm a resumption of the bear cycle and this would open $1610.5, a Fibonacci projection.

SILVER TECHS: Still Looking For Weakness Near-Term

• RES 4: $21.967 - High Jun 17
• RES 3: $21.540 - High Jun 27
• RES 2: $20.876 - High Aug 15 and the bull trigger
• RES 1: $20.014 - High Sep 12
• PRICE: $19.145 @ 08:19 BST Sep 30
• SUP 1: $17.562 - Low Sep 1 and bear trigger
• SUP 2: $16.955 - Low Jun 15 2020
• SUP 3: $16.473 - 1.00 proj of the Jun 6 - Jul 14 - Aug 10 price swing
• SUP 4: $15.998 - 76.4% retracement of the 2020 - 2021 bull leg

Silver maintains a softer tone despite its most recent gains. The recent break of $18.845, Sep 12 low, confirms the end of the recent corrective recovery between Sep 1 - 12. A continuation lower would pave the way for a move towards the key support and bear trigger at $17.562, the Sep 1 low. Clearance of this level would confirm a resumption of the broader downtrend. Key resistance is at $20.014, Sep 12 high. A break would be bullish.